HDFC Life, ICICI Pru Reset Distributor Terms Amid ITC Hit, Bancassurance Impacted
Banking
M
Moneycontrol•28-01-2026, 12:37
HDFC Life, ICICI Pru Reset Distributor Terms Amid ITC Hit, Bancassurance Impacted
- •HDFC Life and ICICI Prudential Life are renegotiating distributor terms, especially in bancassurance, due to GST-driven input tax credit (ITC) loss.
- •Bancassurance, heavily reliant on parent banks (HDFC Bank for HDFC Life, ICICI Bank for ICICI Pru), accounts for a significant portion of their APE.
- •HDFC Life has completed negotiations with distributors, including banks, and implemented revised commercial terms, expecting full impact by Q4 FY26.
- •ICICI Prudential Life's negotiations are ongoing due to its diverse partner base, though the ITC loss has already been absorbed into P&L and VNB.
- •Both insurers are shifting focus from volume to value, tracking VNB counter share and seeing strong protection business growth within bancassurance despite overall channel slowdown.
Why It Matters: HDFC Life and ICICI Pru are recalibrating bancassurance terms post-GST ITC loss, focusing on value over volume.
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